Fare Forward: Indian Railways Rationalises Ticket Prices, Targets Long-Haul Journeys

Updated: December 21, 2025 19:15

Image Source: The Indian Express

Indian Railways has introduced a fare rationalisation effective December 26, 2025, increasing non-AC long-distance fares by Rs 10 for 500 km journeys. Mail and Express train fares in non-AC and AC classes see a 2 paise per km rise, while suburban and short-distance travel remains unaffected. The move is expected to generate Rs 600 crore in additional revenue annually.

Indian Railways has rolled out a fare rationalisation plan effective December 26, 2025, with a modest increase for non-AC long-distance travel. The move aims to support financial sustainability while keeping short-distance and suburban travel affordable, with expected annual revenue gains of Rs 600 crore.

What’s Changing

The new fare structure will see passengers travelling up to 500 km in non-AC coaches pay an additional Rs 10 for their journey. Mail and Express train fares in non-AC classes are increased by 2 paise per kilometre, with AC class fares also rising by 2 paise per km. No changes apply to suburban (local) train services or Monthly Season Tickets (MSTs), ensuring affordability for daily commuters. Ordinary Class journeys up to 215 km remain unaffected by the hike.

Why the Rationalisation

The Railways cited a significant expansion of its network and operations over the past decade, requiring higher manpower and safety investments. Manpower costs have surged to Rs 1.15 lakh crore, with pension expenditure at Rs 60,000 crore, pushing total operational costs to Rs 2.63 lakh crore in 2024–25. The revenue boost from fare rationalisation will help offset rising expenses while supporting ongoing safety and efficiency upgrades.

Operational Impact

The revised fare structure is expected to generate approximately Rs 600 crore in additional revenue this year. Indian Railways highlighted improved operational efficiency, noting it has become the world’s second-largest cargo-carrying railway network. The successful mobilisation of over 12,000 special trains during the recent festival season demonstrates enhanced operational capabilities.

Key Takeaways

The fare hike is marginal and targeted, focusing on long-distance non-AC and AC travel. Short-distance, suburban, and season ticket holders will not see any increase, maintaining affordability for regular commuters.
The move is part of a broader strategy to modernize services and ensure financial viability amid rising operational costs.

Source: The Indian Express, Republic World, India Today, News18, Business Standard, Times of India

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